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U.S. Supreme Court Decides Pension Beneficiary Following Divorce And Death

By Diana L. Skaggs

The U.S. Supreme Court issued a unanimous decision in Kennedy v. DuPont. The Court held the plan administrator of an ERISA benefits plan should pay plan benefits to wife #1, who was the designated plan beneficiary on a designation executed during the marriage and not to wife #2, who was married to the deceased participant spouse at the time of his death. The divorce decree in question awarded 100% of the deceased participant's benefits to participant, not wife #1. However, participant failed to change his beneficiary designation after the divorce. SCOTUS BLOG points out, The Court, however, did leave open for the future a related question: if an ex-spouse is handed the benefits by a plan manager, might they still have to be surrendered, once the payout was completed? A footnote indicated that the Court on Monday was only resolving how federal benefit law applied to the initial distribution of plan payments, not their subsequent fate. Here is the syllabus.

Full post as published by Divorce Law Journal on February 26, 2009 (boomark / email).